Filed Pursuant to Rule 424(b)(2)
Registration Statement No. 333-227001
|
|||
Pricing Supplement
Dated January 21, 2021
To the Product Prospectus Supplement Dated October 18, 2018, the Prospectus Supplement Dated September 7, 2018 and the Prospectus Dated September 7, 2018
|
$920,000
Fixed Coupon Barrier Notes Linked to the
Common Stock of General Motors Company,
Due February 25, 2022
Royal Bank of Canada
|
||
Issuer:
|
Royal Bank of Canada
|
Stock Exchange Listing:
|
None
|
Trade Date:
|
January 21, 2021
|
Principal Amount:
|
$1,000 per Note
|
Issue Date:
|
January 26, 2021
|
Maturity Date:
|
February 25, 2022
|
Coupon Payment:
|
The Coupon will be paid in a single payment at maturity.
|
Final Stock Price:
|
The closing price of the Reference Stock on the Valuation Date.
|
Payment at Maturity
(if held to maturity):
|
For each $1,000 in principal amount of the Notes, the investor will receive at maturity $1,000 plus the Coupon Payment, unless the Final Stock Price is less than the Barrier Price.
If the Final Stock Price is less than the Barrier Price, then the investor will receive at maturity, for each $1,000 in principal amount, in addition to the Coupon Payment, a cash payment equal
to: $1,000 + ($1,000 x Reference Stock Return)
Investors could lose some or all of their principal amount if the Final Price of the Reference Stock is less than the Barrier Price.
|
||
Monitoring Period:
|
The Valuation Date.
|
Reference Stock
|
Coupon Payment |
Initial
Stock
Price
|
Barrier
Price*
|
CUSIP/ISIN
|
Principal
Amount
|
Price to
Public(1)
|
Underwriting Discounts
and Commissions(1)
|
Proceeds to
Royal Bank of
Canada
|
||||||||
General Motors Company (GM)
|
12.15% of the Principal Amount
|
$55.08
|
$35.80, which is 65% of the Initial Stock Price
|
78016E2K2/
US78016E2K26
|
$920,000
|
100%
|
$0
0%
|
$920,000
100%
|
|
|
Fixed Coupon Barrier Notes
Royal Bank of Canada
|
General:
|
This pricing supplement relates to an offering of Fixed Coupon Barrier Notes (the “Notes”) linked to the common stock (the “Reference Stock”) of General Motors Company (the “Reference Stock
Issuer”).
|
Issuer:
|
Royal Bank of Canada (“Royal Bank”)
|
Trade Date (Pricing
Date):
|
January 21, 2021
|
Issue Date:
|
January 26, 2021
|
Valuation Date:
|
February 22, 2022
|
Maturity Date:
|
February 25, 2022
|
Denominations:
|
Minimum denomination of $1,000, and integral multiples of $1,000 thereafter.
|
Designated Currency:
|
U.S. Dollars
|
Coupon Payment:
|
12.15% of the principal amount. ($121.50 per $1,000 in principal amount.)
|
Coupon Payment
Date:
|
The Maturity Date.
|
Early Redemption:
|
The Notes are not subject to redemption prior to maturity, whether at our option, or based on the closing price of the Reference Stock at any time.
|
Record Date:
|
The Coupon Payment due at maturity will be payable to the person to whom the payment at maturity is payable.
|
Initial Stock Price:
|
The closing price of the Reference Stock on the Trade Date, as set forth on the cover page of this document.
|
Barrier Price:
|
65% of the Initial Stock Price, as set forth on the cover page of this document.
|
Final Stock Price:
|
The closing price of the Reference Stock on the Valuation Date.
|
Payment at Maturity (if
held to maturity):
|
For each $1,000 in principal amount of the Notes, the investor will receive $1,000 plus the Coupon Payment, unless the Final Stock Price is less than the Barrier Price.
If the Final Stock Price is below the Barrier Price, you will receive at maturity, for each $1,000 in principal amount, in addition to the Coupon Payment, a cash payment equal to: $1,000 +
($1,000 x Reference Stock Return).
The amount of cash that you receive will be less than your principal amount.
Investors in the Notes will lose some or all of their principal amount if the Final Price of the Reference Stock is less than the Barrier Price.
|
Reference Stock
Return:
|
Final Stock Price – Initial Stock Price
Initial Stock Price |
Physical Delivery
Amount:
|
Not applicable. Payments on the Notes will be made solely in cash.
|
|
|
Fixed Coupon Barrier Notes
Royal Bank of Canada
|
Monitoring Period:
|
The Valuation Date. The price of the Reference Stock between the Trade Date and the Valuation Date will not impact the Payment at Maturity.
|
Monitoring Method:
|
Close of Trading Day
|
Calculation Agent:
|
RBC Capital Markets, LLC (“RBCCM”)
|
U.S. Tax Treatment:
|
By purchasing a Note, each holder agrees (in the absence of a change in law, an administrative determination or a judicial ruling to the contrary) to treat the Note as a pre-paid cash-settled derivative contract
linked to the Reference Stock for U.S. federal income tax purposes. However, the U.S. federal income tax consequences of your investment in the Notes are uncertain and the Internal Revenue Service could assert that the Notes should be taxed
in a manner that is different from that described in the preceding sentence. Please see the discussion in this pricing supplement under “Supplemental Discussion of U.S. Federal Income Tax Consequences,” and the discussion (including the
opinion of our counsel Morrison & Foerster LLP) in the product prospectus supplement under “Supplemental Discussion of U.S. Federal Income Tax Consequences,” which apply to the Notes.
|
Secondary Market:
|
RBCCM (or one of its affiliates), though not obligated to do so, may maintain a secondary market in the Notes after the Issue Date. The amount that you may receive upon sale of your Notes
prior to maturity may be less than the principal amount.
|
Listing:
|
The Notes will not be listed on any securities exchange.
|
Settlement:
|
DTC global (including through its indirect participants Euroclear and Clearstream, Luxembourg as described under “Description of Debt Securities—Ownership and Book-Entry Issuance” in the
prospectus dated September 7, 2018).
|
Terms Incorporated in
the Master Note:
|
The terms appearing on pages P-2 and P-3 of this pricing supplement and the terms appearing under the caption “General Terms of the Notes” in the product prospectus supplement, as modified by
this pricing supplement.
|
|
|
Fixed Coupon Barrier Notes
Royal Bank of Canada
|
|
|
Fixed Coupon Barrier Notes
Royal Bank of Canada
|
Hypothetical Final Stock Price of
the Reference Stock
|
Payment at Maturity as
Percentage of Principal Amount
|
Payment at Maturity
|
$150.00
|
100.00%
|
$1,000.00
|
$140.00
|
100.00%
|
$1,000.00
|
$130.00
|
100.00%
|
$1,000.00
|
$120.00
|
100.00%
|
$1,000.00
|
$110.00
|
100.00%
|
$1,000.00
|
$100.00
|
100.00%
|
$1,000.00
|
$90.00
|
100.00%
|
$1,000.00
|
$80.00
|
100.00%
|
$1,000.00
|
$70.00
|
100.00%
|
$1,000.00
|
$65.00
|
100.00%
|
$1,000.00
|
$64.99
|
64.99%
|
$649.90
|
$60.00
|
60.00%
|
$600.00
|
$50.00
|
50.00%
|
$500.00
|
$40.00
|
40.00%
|
$400.00
|
$30.00
|
30.00%
|
$300.00
|
$20.00
|
20.00%
|
$200.00
|
$10.00
|
10.00%
|
$100.00
|
$0.00
|
0%
|
$0.00
|
|
|
Fixed Coupon Barrier Notes
Royal Bank of Canada
|
|
|
Fixed Coupon Barrier Notes
Royal Bank of Canada
|
• |
You May Lose All or a Portion of the Principal Amount at Maturity — Investors in the Notes could lose all or a substantial portion of their principal amount if there is a
decline in the closing price of the Reference Stock between the Trade Date and the Valuation Date. If the Final Stock Price on the Valuation Date is less than the Barrier Price, the amount of cash that you receive at maturity will represent a
loss of your principal. The Coupon Payment on the Notes may not be sufficient to compensate for any such loss.
|
• |
The Return on the Notes Will Be Limited — The return on the Notes will be limited to the Coupon Payment. Accordingly, your return on the Notes may be less than your return
would be if you made an investment in the Reference Stock or in a security directly linked to the positive performance of the Reference Stock.
|
• |
Your Return on the Notes May Be Lower than the Return on a Conventional Debt Security of Comparable Maturity — The return that you will receive on the Notes, which could be
negative, may be less than the return you could earn on other investments. Your return may be less than the return you would earn if you bought a conventional senior interest bearing debt security of Royal Bank.
|
• |
Payments on the Notes Are Subject to Our Credit Risk, and Changes in Our Credit Ratings Are Expected to Affect the Market Value of the Notes — The Notes are our senior
unsecured debt securities. As a result, the amount due at maturity is dependent upon our ability to repay our obligations on that date. This will be the case even if the price of the Reference Stock increases after the Trade Date. No
assurance can be given as to what our financial condition will be during the term of the Notes.
|
• |
There May Not Be an Active Trading Market for the Notes-Sales in the Secondary Market May Result in Significant Losses — There may be little or no secondary market for the
Notes. The Notes will not be listed on any securities exchange. RBCCM and our other affiliates may make a market for the Notes; however, they are not required to do so. RBCCM or any of our other affiliates may stop any market-making
activities at any time. Even if a secondary market for the Notes develops, it may not provide significant liquidity or trade at prices advantageous to you. We expect that transaction costs in any secondary market would be high. As a
result, the difference between bid and asked prices for your Notes in any secondary market could be substantial.
|
• |
The Initial Estimated Value of the Notes Is Less than the Price to the Public —The initial estimated value that is set forth on the cover page of this pricing supplement does
not represent a minimum price at which we, RBCCM or any of our affiliates would be willing to purchase the Notes in any secondary market (if any exists) at any time. If you attempt to sell the Notes prior to maturity, their market value may
be lower than the price you paid for them and the initial estimated value. This is due to, among other things, changes in the price of the Reference Stock, the borrowing rate we pay to issue securities of this kind, and the inclusion in the
price to the public of the estimated costs relating to our hedging of the Notes. These factors, together with various credit, market and economic factors over the term of the Notes, are expected to reduce the price at which you may be able
to sell the Notes in any secondary market and will affect the value of the Notes in complex and unpredictable ways. Assuming no change in market conditions or any other relevant factors, the price, if any, at which you may be able to sell
your Notes prior to maturity may be less than your original purchase price, as any such sale price would not be expected to include the hedging costs relating to the Notes. In addition to bid-ask spreads, the value of the Notes determined by
RBCCM for any secondary market price is expected to be
|
|
|
Fixed Coupon Barrier Notes
Royal Bank of Canada
|
• |
The Initial Estimated Value of the Notes on the Cover Page of this Pricing Supplement Is an Estimate Only, Calculated as of the Time the Terms of the Notes Were Set —The
initial estimated value of the Notes is based on the value of our obligation to make the payments on the Notes, together with the mid-market value of the derivative embedded in the terms of the Notes. See “Structuring the Notes” below. Our
estimate is based on a variety of assumptions, including our credit spreads, expectations as to dividends, interest rates and volatility, and the expected term of the Notes. These assumptions are based on certain forecasts about future
events, which may prove to be incorrect. Other entities may value the Notes or similar securities at a price that is significantly different than we do.
|
• |
Our Business Activities May Create Conflicts of Interest — We and our affiliates expect to engage in trading activities related to the Reference Stock that are not for the
account of holders of the Notes or on their behalf. These trading activities may present a conflict between the holders’ interests in the Notes and the interests we and our affiliates will have in their proprietary accounts, in facilitating
transactions, including options and other derivatives transactions, for their customers and in accounts under their management. These trading activities, if they influence the share price of the Reference Stock, could be adverse to the
interests of the holders of the Notes. We and one or more of our affiliates may, at present or in the future, engage in business with the Reference Stock Issuer, including making loans to or providing advisory services. These services could
include investment banking and merger and acquisition advisory services. These activities may present a conflict between our or one or more of our affiliates’ obligations and your interests as a holder of the Notes. Moreover, we and our
affiliates may have published, and in the future expect to publish, research reports with respect to the Reference Stock. This research is modified from time to time without notice and may express opinions or provide recommendations that are
inconsistent with purchasing or holding the Notes. Any of these activities by us or one or more of our affiliates may affect the price of the Reference Stock, and, therefore, the market value of the Notes.
|
• |
Owning the Notes Is Not the Same as Owning the Reference Stock — The return on your Notes is unlikely to reflect the return you would realize if you actually owned shares of
the Reference Stock. For instance, you will not receive or be entitled to receive any dividend payments or other distributions on the Reference Stock during the term of your Notes. As an owner of the Notes, you will not have voting rights or
any other rights that holders of the Reference Stock may have. Furthermore, the Reference Stock may appreciate substantially during the term of the Notes, while your potential return will be limited to the Coupon Payment.
|
• |
There Is No Affiliation Between the Reference Stock Issuer and RBCCM, and RBCCM Is Not Responsible for any Disclosure by the Reference Stock Issuer — We are not affiliated
with the Reference Stock Issuer. However, we and our affiliates may currently, or from time to time in the future engage, in business with the Reference Stock Issuer. Nevertheless, neither we nor our affiliates assume any responsibilities for
the accuracy or the completeness of any information that any other company prepares. You, as an investor in the Notes, should make your own investigation into the Reference Stock. The Reference Stock Issuer is not involved in this offering
and has no obligation of any sort with respect to your Notes. The Reference Stock Issuer has no obligation to take your interests into consideration for any reason, including when taking any corporate actions that might affect the value of
your Notes.
|
|
|
Fixed Coupon Barrier Notes
Royal Bank of Canada
|
• |
The Payments on the Notes Are Subject to Market Disruption Events and Adjustments —The payment at maturity and the valuation date are subject to adjustment as described in
the product prospectus supplement. For a description of what constitutes a market disruption event as well as the consequences of that market disruption event, see “General Terms of the Notes—Consequences of Market Disruption Events” in the
product prospectus supplement.
|
|
|
Fixed Coupon Barrier Notes
Royal Bank of Canada
|
|
|
Fixed Coupon Barrier Notes
Royal Bank of Canada
|
|
|
Fixed Coupon Barrier Notes
Royal Bank of Canada
|
|
|
Fixed Coupon Barrier Notes
Royal Bank of Canada
|
|
|
Fixed Coupon Barrier Notes
Royal Bank of Canada
|
[E@DG$C&%@Z*)65<@@@E0<-@@$9!Q527P[IDT MLDDD$C>9ORAGDV#>"&PN[:N0QS@#K0!'!K<@NGMK^S>&8+&ZBV#W VN6 W%4 M^4_*U2>&,1A54DR #KD_=7.3ZXQG VUMH4N6N5 M3$SQK&S9/*J20/S8_G5/^P[#[3 1+B&Z:^-S$PWK>+"& (R-OE?*5Z]R>M:U5;'3K;3D=;=9/WC;G:25I&8 MXP,LQ)/ ]:M4 %(>AYQ]:6HKFVCN[=H)3($;J8I6C;_OI2"/SH YN7Q/<6.G MV4KVZ71-I'/<,IDWKD9)(2)E4'!QN90<'L,U;3Q#*)PTUCLLWN)K9)(W:25F MCWY/EJF<$(>A)]N]6[CP_IMU&D 5.]PGS'B1MVX]>^]OSH I7%W<-J.E20SLEI<2%&A: H[?NW;YMPR.57C [ MYSGAMNEVOB)HAJEU/;QPEY8I4BVAF/R %4!X"MU/]WUJY=Z3:WMW# L7%D;TJL<[+=K#%$Q<$CRE8A1&CLQR2>G3/0"MWM6=_8=A]F,&V?:9?-\ MS[3)YF_&,^9NW=..O3CI0!DKXJN);:2>+35\NWMS<7!DG:/: \BL%!3)/[LD M9"^^#5W5M1F?1+ZXT^:6VDMD=F::T=2=JD_+O !&< G0V\T"6^ M(YXC#(#(QW(2Q(R3GJ[<]>:FO].MM2M#:W(E,)ZK',\>X8Q@E2"1ST/% &)K M.I7UOK,44%Q<)"%B+&.)&B3+G=YQ*EERN,;<=\X'-=-68^@:=))'))',[(%! MW7,A$@4Y7>-V'P?[V:TZ "BBB@#-O[Y[.]3]Y&L*VD\S"1MJY4I@EL$@?,>W MYUEP>*+N>1;9=*Q>/*L:H[R1IAE=@29(E;_EFW13[$\BMI]+M)+F:>2-Y'FC M,3AY69=AQD!2<+G S@#.*AM]!T^UG6>..5IE8.));B21LA64 ZO INIXI[JUME MEE"JSJOR!&') &=I_7-;Z64$=M);QJR1R,[-L=E.7)9B&!R#DD\'CM5-/#]A M'9M:H;Q86D,A OIP2QSGYM^<'))&<$\]: )=%NIKW1;2YG'[V2,%OEVY/KCM MGKCM5^F111PQ)%$BI&@"JJC '0 4^@ JGJ<\L%JCQ/M9KB%,X'(:15(_(FK ME5KFPM[N6"2<2,86#HHE95R"""5!PV" 1D'% &%<^+&M+FX5[)9((Q-Y &8"-U%L)+@;7+ ;BJ?* 54D@?F MQ_.@# O[S4;&[O3!?FX5+=W=9(TVV[LRB(# !/!8D$GH.F16CI;7,=W>V=S= MO=>2R,DLB*K89>AV@#J#SCO[4B>'M.C-SA)RMSO\Z-KJ5D??][Y"VW)^E6K+ M3[;3XW2W5QO;<[22-(S' '+,23P .O:@"U1110 AZ'G'UKEY?$]Q8Z?92R6Z M76;2.>X9#)O7(R252(JN<'&YE!P>@&:Z2YMH[NW:"4R!&ZF*5HV_[Z4@C\ZH MW'A_3;J...2!Q&D0A"1SR(K(.BL%8!@.V _)\M4S@[#T).>W>GZA<7+RV,]E>S(TTB!+-X0HD7=^\+AEWKA )&W;CU[[V_.H;C1K.ZOQ?2?:%N @3=%=2Q@J#D A6 M(S[4 ,LY;K^W+^WGN!+$L<4D:K&%";BXQZDX5>IZYQCH.2^-O_)(==_[=_\ MT?'79PZ5:V^H2W\?VC[1*,.7N9&4C.<;2Q4 9.,#C/%<9\;?^20Z[_V[_P#H M^.@#H/ G_)//#/\ V"K7_P!%+705S_@3_DGGAG_L%6O_ **6N@H **** "BB MB@ HHHH **** "BBB@ HHHH **** "BBB@ HHHH **** "BBB@ HHHH **** M "BBB@ HHHH **** "BBB@ HHHH **** "BN=\0C2#J^F?VS]B^S>7-C[9LV M;ODQ][C/6L:;4+C3]*MXK6_DLH7>X:U>>9(U,*L B@O%(6.#E5 !*_A0!W=% M<1)?W:3G4UNV%]-H\ N^7:VL2PPI]D@.U% "C)3)P .M6/^%V_$/\ Z&'_ ,DK M?_XW110 ?\+M^(?_ $,/_DE;_P#QNC_A=OQ#_P"AA_\ )*W_ /C=%% !_P + MM^(?_0P_^25O_P#&Z/\ A=OQ#_Z&'_R2M_\ XW110 ?\+M^(?_0P_P#DE;__ M !NC_A=OQ#_Z&'_R2M__ (W110 ?\+M^(?\ T,/_ ))6_P#\;H_X7;\0_P#H M8?\ R2M__C=%% !_PNWXA_\ 0P_^25O_ /&Z/^%V_$/_ *&'_P DK?\ ^-T4 M4 '_ NWXA_]##_Y)6__ ,;H_P"%V_$/_H8?_)*W_P#C=%% !_PNWXA_]##_ M .25O_\ &Z/^%V_$/_H8?_)*W_\ C=%% !_PNWXA_P#0P_\ DE;_ /QNC_A= MOQ#_ .AA_P#)*W_^-T44 '_"[?B'_P!##_Y)6_\ \;H_X7;\0_\ H8?_ "2M M_P#XW110 ?\ "[?B'_T,/_DE;_\ QNC_ (7;\0_^AA_\DK?_ .-T44 '_"[? MB'_T,/\ Y)6__P ;H_X7;\0_^AA_\DK?_P"-T44 '_"[?B'_ -##_P"25O\ M_&Z/^%V_$/\ Z&'_ ,DK?_XW110 ?\+M^(?_ $,/_DE;_P#QNC_A=OQ#_P"A MA_\ )*W_ /C=%% !_P +M^(?_0P_^25O_P#&Z/\ A=OQ#_Z&'_R2M_\ XW11 M0 ?\+M^(?_0P_P#DE;__ !NC_A=OQ#_Z&'_R2M__ (W110 ?\+M^(?\ T,/_ M ))6_P#\;H_X7;\0_P#H8?\ R2M__C=%% !_PNWXA_\ 0P_^25O_ /&Z/^%V M_$/_ *&'_P DK?\ ^-T44 '_ NWXA_]##_Y)6__ ,;H_P"%V_$/_H8?_)*W M_P#C=%% !_PNWXA_]##_ .25O_\ &Z/^%V_$/_H8?_)*W_\ C=%% !_PNWXA M_P#0P_\ DE;_ /QNC_A=OQ#_ .AA_P#)*W_^-T44 '_"[?B'_P!##_Y)6_\ M\;H_X7;\0_\ H8?_ "2M_P#XW110 ?\ "[?B'_T,/_DE;_\ QNC_ (7;\0_^ MAA_\DK?_ .-T44 '_"[?B'_T,/\ Y)6__P ;H_X7;\0_^AA_\DK?_P"-T44 M'_"[?B'_ -##_P"25O\ _&Z/^%V_$/\ Z&'_ ,DK?_XW110 ?\+M^(?_ $,/ M_DE;_P#QNC_A=OQ#_P"AA_\ )*W_ /C=%% !_P +M^(?_0P_^25O_P#&Z/\ MA=OQ#_Z&'_R2M_\ XW110 ?\+M^(?_0P_P#DE;__ !NC_A=OQ#_Z&'_R2M__ M (W110 ?\+M^(?\ T,/_ ))6_P#\;H_X7;\0_P#H8?\ R2M__C=%% !_PNWX MA_\ 0P_^25O_ /&Z/^%V_$/_ *&'_P DK?\ ^-T44 '_ NWXA_]##_Y)6__ M ,;H_P"%V_$/_H8?_)*W_P#C=%% !_PNWXA_]##_ .25O_\ &Z/^%V_$/_H8 M?_)*W_\ C=%% !_PNWXA_P#0P_\ DE;_ /QNC_A=OQ#_ .AA_P#)*W_^-T44 M '_"[?B'_P!##_Y)6_\ \;H_X7;\0_\ H8?_ "2M_P#XW110 ?\ "[?B'_T, M/_DE;_\ QNC_ (7;\0_^AA_\DK?_ .-T44 '_"[?B'_T,/\ Y)6__P ;H_X7 M;\0_^AA_\DK?_P"-T44 '_"[?B'_ -##_P"25O\ _&Z/^%V_$/\ Z&'_ ,DK M?_XW110 ?\+M^(?_ $,/_DE;_P#QNC_A=OQ#_P"AA_\ )*W_ /C=%% !_P + MM^(?_0P_^25O_P#&Z/\ A=OQ#_Z&'_R2M_\ XW110 ?\+M^(?_0P_P#DE;__ M !NC_A=OQ#_Z&'_R2M__ (W110 ?\+M^(?\ T,/_ ))6_P#\;H_X7;\0_P#H M8?\ R2M__C=%% !_PNWXA_\ 0P_^25O_ /&ZS];^*7C+Q'H\^DZMK/VBQGV^ 39%]EA3=M8,.50$<@'@T44 ?_V0$! end